PREPO CORPORATION v. PRESSURE CAN CORPORATION

• Decision Date: 06 August 1956
• Docket Number: 11716.,No. 11714,11714
• Citation: 234 F.2d 700
• Parties: PREPO CORPORATION, Plaintiff-Appellee, v. PRESSURE CAN CORPORATION and William B. Hinn, Defendants, Knapp-Monarch Company, Defendant-Intervenor-Appellant (two cases).
• Court: U.S. Court of Appeals — Seventh Circuit

234 F.2d 700 (1956)

PREPO CORPORATION, Plaintiff-Appellee, v. PRESSURE CAN CORPORATION and William B. Hinn, Defendants Knapp-Monarch Company, Defendant-Intervenor-Appellant (two cases).

Nos. 11714, 11716.

United States Court of Appeals Seventh Circuit.

June 27, 1956.

Rehearing Denied August 6, 1956.

Will Freeman, John T. Love, Chicago, Ill., for appellant.

Elwin A. Andrus, Milwaukee, Wis., George L. Wallace, Eugene R. Sawall, Andrus & Sceales, Milwaukee, Wis., for appellee.

Before DUFFY, Chief Judge, and FINNEGAN and LINDLEY, Circuit Judges.

LINDLEY, Circuit Judge.

Plaintiff, owner of patent to Falligant, 2,683,484, issued July 13, 1954, originally brought suit in the district court against the defendant Pressure Can Corporation for infringement and unfair competition. Later it joined as defendant the corporation's president, William B. Hinn. Knapp-Monarch Company, having purchased certain assets of Pressure in June 1955, on July 8, 1955, was permitted to intervene and become a party defendant as to the questions raised as to validity and infringement. The cause finally came to issue upon the second amended complaint and the answers thereto. No questions other than those arising upon the first count charging infringement are involved on this appeal.

On October 25, 1955, Knapp-Monarch filed a motion for summary judgment, arguing that the patent was invalid in view of the provisions of R.S. 4886, U.S.C. Title 35, § 102(b), as interpreted by the United States Supreme Court in Muncie Gear Works, Inc., v. Outboard Marine & Mfg. Co., 315 U.S. 759, 62 S.Ct. 865, 86 L.Ed. 1171. The court denied the motion, in which apparently Pressure concurred, and entered final judgment in favor of plaintiff against defendants, adjudging the patent valid and infringed, and ordering an accounting, treble damages and attorney's fees. From that judgment separate appeals have been perfected. The ultimate question submitted is whether the district court was justified in entering summary judgment in plaintiff's favor.

Under Rule 56 of the Federal Rules of Civil Procedure, 28 U.S.C.A., a summary judgment may be entered if it appears that no genuine issue of material fact exists and the question raised is one of law upon undisputed facts. Defendant's motion averred that there was no genuine issue as to any material fact with respect to invalidity of the patent on the ground urged and that defendant was entitled to judgment of invalidity and non-infringement as a matter of law. This admission the district court evidently thought was a waiver of all defenses of invalidity as well as of any question of infringement, giving the court authority under the rule to treat the case as though all questions of fact theretofore presented had been removed from the case, and proceeded to enter final judgment, as at trial, in favor of plaintiff and against defendant declaring the patent valid and infringed.

We think the court labored under a misapprehension of the scope and proper interpretation of Rule 56. In M. Snower & Co. v. United States, 7 Cir., 140 F.2d 367, at page 369, we had occasion to consider a similar situation. There we said that plaintiff "argues that there is no issue of fact because the defendant by making a motion for judgment on the pleadings has admitted the untruth of its denial of plaintiff's allegation * * * when a party moves for judgment on the pleadings, he not only, for the purposes of his motion, admits the truth of all the allegations of his adversary, but must also be deemed to have admitted the untruth of all of his own allegations which have been denied by his adversary. But the cases make it clear that such `admission' is only for the purpose of the motion. In other words, such `admission' is not final, binding, and conclusive in such a way as to amount to a definitive waiver of material facts put in issue by the answer. Instead, the trial may proceed, and the factual issues raised by the answer are then subject to proof. Thus if the court denies a party's motion for judgment on the pleadings, this does not mean that he is precluded from contending that his denials (in his answer) of the allegations in plaintiff's complaint are true." Later, the United States Court of Appeals for the Sixth Circuit, in Begnaud v. White, 170 F.2d 323, agreed, saying at page 327: "The fact that both parties make motions for summary judgment, and each contends in support of his respective motion that no genuine issue of fact exists, does not require the Court to rule that no fact issue exists. Each, in support of his own motion, may be willing to concede certain contentions of his opponent, which concession, however, is only for the purpose of the pending motion. If the motion is overruled, the concession is no longer effective. Appellants' concession that no genuine issue of fact existed was made in support of its own motion for summary judgment. We do not think that the concession continues over into the Court's separate consideration of appellee's motion for summary judgment in his behalf after appellants' motion was overruled. M. Snower & Co. v. United States, 7 Cir., 140 F.2d 367, 369." (Emphasis supplied.)

Under these authorities defendant's admission that there was no genuine issue of material fact involved in its motion for summary judgment admitted, for the...